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Residents launch initiative to Take Back Anaheim

ANAHEIM – Following months of debate over the back-room deal resulting in the handover of $158 million in future Transient Occupancy Tax revenue to spur the development of two luxury hotels, a group of residents has filed a charter amendment initiative to Let the People Vote on such deals in the future.

Larry Larsen (Photo: Chris Prevatt)

Yesterday the group, Take Back Anaheim, unveiled the initiative signed by proponents Anaheim resident and small business owner Larry Larsen and Anaheim Mayor Pro Tem Lorri Galloway. The measure requires all future development incentives using TOT funds be approved by the vote of the people.

“If the city is going to give away tax money to corporate developers, all we want is the right to vote on it,” resident and coalition member Larry Larsen said at a news conference outside City Hall.

In January, Anaheim Council members Harry Sidhu, Gail Eastman, and Kris Murray surprised residents by approving a deal with a well-connected corporate hotel developer to divert 15-years worth of future TOT revenues to fund half the costs of building two luxury hotels in the Garden Walk district. The proposal was opposed by city staff. The giveaway of funds had no community benefit provisions, no guarantees that local construction workers would be hired, and no guarantee that prevailing wages would be paid.

Proponents assert that the council majority “made this unprecedented giveaway at a time when the city has cut funding for police and fire services, parks and libraries. These subsidies give away tax dollars that would in the future otherwise fund public safety, infrastructure and public services, such as parks and libraries.”

Anaheim Mayor Pro Tem Lori Galloway (Photo: Chris Prevatt)

The giveaway prompted significant community objection that was ignored by the council majority. Mayor Pro Tem Galloway said yesterday; “As a council member, I understand the value of a representative government but when it goes this far wrong, against the will of the people, something needs to be done.”

The Orange County Register in its coverage of yesterday’s press conference quoted Councilwoman Kris Murray who opposes the initiative.

“Elections are expensive, and if every time we need to go before the voters, it could severely limit growth in this city,” Murray said. “It is very competitive (among developers), and this could have them looking elsewhere.”

Councilwoman Kris Murray, Photo: Chris Prevatt

Voice of OC reported yesterday that after the January 24thvote former mayor Curt Pringle was seen with Councilwoman Murray and one of the hotel developers receiving the TOT giveaway Bill O’Connell at The Ranch Restaurant & Saloon in Anaheim the night of the Council vote, celebrating the subsidy deal with dinner and drinks.

At the City Council meeting on Tuesday, Councilwoman Murray, in what appears to be direct retribution for placing her name on the proposed initiative, placed consideration of appointing a new Mayor Pro Tem to replace Galloway.

The OC Register reports that Jill Kanzler, executive director of Support Our Anaheim Resort, said her organization has more than 10,000 members and will strongly fight the initiative.

“SOAR’s mission is to protect the Anaheim Resort, which generates more than 50 percent of the city’s revenues and helps pay for a majority of its police, fire and other vital services,” she said in a statement. “We oppose this potential initiative, because it negatively impacts Anaheim, by stifling future growth, killing jobs and pushing tax revenues to other cities.”

It’s unclear how giving away future tax revenues to developers is any different than pushing those revenues to other cities.

The initiative proponents have until July 24th to gather approximately 15,000 signatures—10% of Anaheim voters—to place the initiative on the November general election ballot.

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6 comments for “Residents launch initiative to Take Back Anaheim”

granthenninger

April 6, 2012 at 12:07 pm

The difference between the deal struck by the City Council and pushing these developments to other cities is that Anaheim gets some revenue under the deal approved by Council. Anaheim will receive additional property taxes, 20% of TOT, and sales taxes from the additional guests those hotels will support. Anaheim would not get these same revenues if the hotels were built in another city.

The question we must ask when evaluating a deal like this is whether or not it’s better to receive less money but get it sooner, or to wait to receive more money. As somebody said at Tuesday’s council meeting, it’s nearly impossible to predict what will happen in the future, but we can make a good guess at it. From the best available data, making some fairly conservative assumptions about the future, this is a good deal for Anaheim. Yes, the city will receive less tax revenue, but the hotels will also be built sooner.

This is a complex argument and evaluation to make, it’s much easier to argue that this is a $158 million tax giveaway. This is a case where our elected officials need to work hard at explaining why it’s good for Anaheim, and vote for what is in the best interest of the city despite public sentiment. That’s why we have a representative government instead of direct democracy.

Subjecting every economic assistance agreement to a public vote would effectively render that tool of economic development useless. This is the exact same strategy affordable housing opponents used to try to stop new affordable housing developments in California. It’s a strategy that works well, but leads to poor policy decisions.

Anaheim needs to ensure that it’s primary source of general fund revenue continues to thrive. The city faces stiff competition from Garden Grove, Buena Park and other surrounding cities. All of which are willing to give away a lot more than Anaheim has in this deal. In order for Anaheim to continue to grow and urbanize, it needs to have a full complement of tools at its disposal. Removing these types of economic assistance agreements from the city’s toolbox is not the way towards a more prosperous future for Anaheim.

Insiderheim

April 6, 2012 at 1:55 pm

Grant,
I respect your opinion but I just cant forget the fact that city staff recommended against it. It’s a hard sell to the public when we hear about questionable contributions that the DA is looking into. Also the fact that the deal would be dead if the city didn’t kickin for 15 years. I don’t think it would be an issue if the council didn’t vote on a “discussion” item and if we know who all the people are that stand to benefit from the deal. I think you might have a change of heart when all the info surfaces, because the water cooler talk around town is that the main players in the deal are very nervous about this info. Let’s just wait and see how this plays out.

After Kris Murray and Gail Eastman were elected, Sidhu, Murray and Eastman displayed no interest – even shown an animosity and disregard for, transparent government or representing the people of Anaheim.

We have seen shredding of documents. Defiance of the Freedom of Information Act requests. City Employee Hannah Jones, a manager in the Anaheim Building and Planning Department, issuing internal directives to shred and delete emails and documents that “can very easy portray the actions of city staff, applications, contractors and decision makers out of context and damage our credibility.” Murray, Eastman and Sidhu approving this $158 million giveaway in a rushed manner, AGAINST STAFF RECOMMENDATION, without any actual debate, reasoning, or transparency, hiding the identity of the actual beneficiaries of the deal. They refuse to attend citizen forums, discuss in any way, or defend their rush decision AGAINST STAFF RECOMMENDATION to approve this Mega-Millions giveaway.

They have outsourced work to firms employing city officials. The City Manager resigned under serious conflict of interest allegations.

Murray is seen out on the town celebrating the $158 Million giveaway with Curt Pringle – a lobbyist – and one of the developers receiving the giveaway. Wonder who paid for that dinner? The Anaheim taxpayers.

Murray has used her position to harrass city Employees for the benefit of her private employer.

Now she seeks blatant open political retaliation against Lorri Galloway by seeking to strip her of her Mayor Pro Tem position because of her outspoken opposition of the $158 Million giveaway and support for safeguards to prevent further fleecing of Ahaheim by unscrupulous businesses and developers and their OCBC trained, elected cronies on City Council.

A recall of Murray, Eastman and Sidhu should be added to the ballot as well. May be that is what Murray is afraid of – and should be.

I, too, have tremendous respect for Grant’s opinion. However, this response is what should be expected with deals cut in this manner, on a rushed basis, against staff recommendation, with alot of details in the dark.

Grant is correct in saying that there should have been communication about the deal and why it is a good deal for Anaheim – this certainly was not done, and I do not believe it can be done retrospectively. The details of these kinds of deals are not so arcane that the public cannot be brought into the loop up front. Further, there should be a mandatory disclosure of the individuals benefitting from the deal, as well as the financial details of the deal and the profit they are obtaining as a result of the deal.

I also highly question the alternatives proposed by Grant: Garden Grove and Buena Park do not have Disneyland, California Adventure, and the thriving hotel business which accompanies them. Disney is not going to abandon Anaheim, either. They are vested permanently in Anaheim. Buena Park and Garden Grove are not reasonable or viable alternatives. Further, the land to be developed is land that almost certainly will ultimately be sold off to Disney, and even if not, will have an almost certain guarantee of high occupancy due to existing attractions and infrastructure, rendering the alternative of developing a high end resort in a place like Garden Grove or Buena Park (even with Knott’s) rather ridiculous.

This is a deal driven by greed and politicians in the thrall of big business, planning their own futures rather than that of the City of Anaheim.

Minta Stovall

April 16, 2012 at 4:16 pm

I completely agree it is to pad their own greedy pockets. They shouldn’t be asking for the city of Anaheim to get involved. It’s their own problem if they can’t raise the funds themselves. Everybody else has to do it don’t they? All the other Hotel owners had to raise the money themselves so why does Anaheim have to subsided this outrageous idea. Let them eat cake that they baked payfor and raised themselves. Why fill their greedy pockets. Put a public vote to it.

Gigi Thomas

April 25, 2012 at 11:22 pm

This is a good deal for the City in the long run. They will reap benefits for years to come over the long haul by keeping the revenues in Anaheim and not allowing the project to be built in a competing City. This is no different that what is happening in Santa Barbara with the landmark Mira Mar Hotel that Rick Caruso is developing. Kudos to the Anaheim Council Members for recognizing this.